Multibillion-dollar health fund fires watchdog

Thursday

Nov 15, 2012 at 5:02 PM

The Associated Press

A $23-billion health fund trying to restore its image announced Thursday that it fired its top internal watchdog, whose office uncovered millions in financial losses that led some donors to withhold funding.

The Global Fund to Fight AIDS, Tuberculosis and Malaria said in a statement its board had sacked Inspector General John Parsons "after a careful review of his performance, which was found to be unsatisfactory."

The fund was shaken after Associated Press articles last year reported on the millions of dollars in financial losses revealed by Parsons' office. The articles led some donors, including Germany and the European Commission, to temporarily withhold funding, and the fund scaled back spending.

The inspector general's office is supposed to function independently. It was created in 2005 at the urging of the fund's biggest donor, the United States, which has contributed $7.3 billion to date.

The board held a contentious closed-door session with Parsons on Wednesday then deliberated into the night after he stormed out.

The board chairman, Simon Bland, and the head of its audit committee, Graham Joscelyne, each said they were unconcerned whether U.S. lawmakers might perceive the firing as an infringement on the office. Joscelyne would not elaborate on what Parsons did wrong but cited several reviews of him that were not disclosed.

In its latest 6-month progress report, Parsons' office said it had a growing caseload of 142 active investigations, up more than 70 percent from just two years ago.

Separately, the fund's board chose as its new executive director Mark Dybul, an openly gay doctor who served as U.S. global AIDS coordinator to former President George W. Bush.

In the wake of the reports, the Global Fund appointed a special review panel that recommended tighter financial controls and led to the departures of the former executive director, French immunologist Dr. Michel Kazatchkine, and the fund's chief spokesman, Jon Liden. But the panel also found friction between Kazatchkine, who was trying to reassure donors, and Parsons, whose teams of auditors and investigators were reporting the losses.

Before joining the Global Fund in 2007, Parsons, a British citizen, had served as a director at U.N. agencies UNESCO and UNICEF. He headed Britain's National Audit Office from 1989 to 1996. He could not immediately be reached for comment.

The Geneva-based fund was set up in 2002 as a new way to coordinate world efforts against the diseases and to speed up emergency funds from wealthy nations and donors to the places hardest hit. It currently pays for the treatment of around half the developing world's AIDS sufferers.